Govt Shutdown Exacerbates Decline of US Housing Market - Wall Street Analyst

© AFP 2023 / JEFF HAYNESA house sits for sale 30 March 2007 in North Aurora, Illinois, a suburb outside of Chicago
A house sits for sale 30 March 2007 in North Aurora, Illinois, a suburb outside of Chicago - Sputnik International
WASHINGTON (Sputnik) - Tuesday marked day 25 of the longest federal government shutdown in US history amid a political stalemate over border security funding that has no end in sight.

The US government shutdown is hurting an already declining domestic housing market but the overall economic impact so far has been relatively minor, Wall Street analyst and Trends Research Institute head Gerald Celente told Sputnik.

"Currently it [the shutdown] will… hit housing harder which is already on a down trend because of rising interest rates," Celente said. "Refinancing and new mortgage applications are already on a down trend. This will just make it a bit worse since January is also a very slow housing sales month."

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As for the stock markets, Celente said there has been no real impact at this time.

"Earnings and the hope of less aggressive interest rate hikes are what are of most concern along with, of course, the slowing global economy and geopolitical concerns, especially in the Middle East and Venezuela and whether military actions will drive up oil prices," Celente said.

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The government shut down on 22 December after congressional Democrats refused to approve a spending bill that allocated $5.7 billion to build a wall on the southern border that President Donald Trump has demanded.

The shutdown so far has cost the US economy around $3.6 billion, Standard & Poor’s Chief US Economist Beth Ann Bovino said in a statement on Friday. The S&P estimate also indicates that a shutdown lasting for two more weeks would cost the US economy nearly $6 billion, exceeding the $5.7 billion sought by Trump for his much-anticipated border wall project.

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